Research in Motion Asks Employees to Limit Vacation; Work Six-Day Weeks
Struggling Blackberry-maker Research in Motion (NASDAQ: RIMM) is seemingly beginning to grasp the desperate situation in which it finds itself. According to the Ottawa Citizen, the company is limiting summer vacations and ordering six-day work weeks for many of its staffed based in Ottawa. The company is attempting to speed up production of its BlackBerry 10 operating system, which RIM said would not be ready for the holidays. Ottawa is the "epicentre" of development for BlackBerry 10, according to the Citizen.
“The successful launch of the BlackBerry 10 platform, and the delivery of high quality, full-featured BlackBerry 10 smartphones, remains the company's No. 1 priority; and we're incredibly proud of the commitment shown by all RIM employees as we work toward this goal,” a RIM spokeswoman said in a statement. Initially, BlackBerry 10 was expected to be ready by the Fall, but due to delays, Research in Motion now expects that it will not launch until the first-quarter of 2013, missing the critical holiday selling season.
“RIM's development teams are relentlessly focused on ensuring the quality and reliability of the platform and I will not compromise the product by delivering it before it is ready,” CEO Thorsten Heins said on a conference call. “Over the past several weeks, RIM's software development teams have made major progress in the development of key features for BlackBerry 10. However, the integration of these features and the associated large volume of code into the platform has proven to be more time consuming than anticipated."
In addition to getting BlackBerry 10 out, the company is focusing on streamlining its operations and cutting costs. Research in Motion has said that many of the 5,000 employees it is planning to lay off have already been notified. The company is also working with JPMorgan (NYSE: JPM) and RBC Capital Markets to generate $1 billion in cost cuts.
Last week, Research in Motion announced a quarterly loss of $518 million versus a profit of $695 million in the year-ago period. Even more concerning, sales fell from $4.91 billion to $2.81 billion. The company also said that it expects the next several quarters to be very challenging. Research in Motion shares have fallen more than 45% in 2012 and almost 89% over the last 5 years as the company's business has been decimated by competition from Apple's (NASDAQ: AAPL) iPhone and Google's (NASDAQ: GOOG) Android devices.
© 2015 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.